After a transformational start to the millennium, we enter a new decade
 that will build on our vision to emerge as a global biopharmaceutical
 enterprise that delivers valuable and affordable products and services
 to patients, partners and healthcare providers the world over. Our
 efforts thus far, have seen us take calculated and deliberate steps to
 build a risk balanced portfolio of biopharmaceutical products and
 services through a number of valuable research and marketing
 partnerships.  This judicious growth strategy has enabled us to become
 global suppliers of drug substances like statins, immunosuppressants
 and insulins. Adopting a portfolio approach for our research pipeline,
 we have created high value R&D assets that
 
 we are periodically unlocking through licensing or via market access.
 The path ahead is about building Brand Biocon through products that can
 make a diff- erence to chronic diseases like diabetes, cancer,
 cardiovascular, autoimmune and renal malfunction.
 
 The journey ahead is therefore one of value added transition.  From
 drug substance to drug product. From Drug Master Files (DMFs) to
 Product Dossiers. Over the last decade, Biocon has built signifcant
 brand equity across our customer base. The task before us now, is to
 extend that brand recognition to our products in the retail market.
 
 In building Brand Biocon, we look beyond the market and aim to deliver
 medical education to healthcare pro- fessionals and patients with a
 view to create greater awareness of disease management and thereby,
 better out-
 
 come. Brand Biocon is committed to making a difference to patients
 through affordable drug innovation.
 
 I am very happy to share with you the progress we have made in creating
 this brand recognition.
 
 Brand Building through Differentiation and Specialization
 
 We have adopted a well researched business strategy to develop products
 that address chronic therapies in select disease segments. We have
 identified anchor products to spearhead the launch of our brands into
 the Indian market. The first such key product was recombinant human
 insulin branded Insugen® that launched our Diabetology division in
 2004. Entering at the lowest rung, we have worked our way up the
 anti-diabetic value chain to be ranked 12th in our represented market
 last fiscal. Insugen® is a leading brand in the country today, rapidly
 narrowing the gap with its innovator counterparts.
 
 Our first insulin analog Glargine, branded BASALOG® was introduced into
 the market in 2010 and is already the No. 2 brand. We have innovatively
 supported this division by a successful patient engagement program,
 Winning with Diabetes, and are now creating a medical education forum,
 ABIDE. This forum enables doctor-patient interface based on an IT
 platform and aims to disseminate medical information and training
 modules to diabetics and physicians in remote reaches of the country.
 
 Spurred by the success of our insulins, we entered into an exciting
 agreement with Pfizer to address a large and lucra- tive global
 biosimilar insulin opportunity.
 
 Biocon has also developed a very strong portfolio around Chronic Kidney
 Disease. Our Nephrology division has performed exceedingly well with
 its flagship brands TACROGRAF™ (tacrolimus) now occupying the No. 2
 position in the market and RENODAPT® (mycophenolate mofetil) the third
 largest brand in its category. Impressive branding, high share of noise
 in the market and a differentiated safety device have propelled the
 success of
 
 our ERYPRO™ group of erythropoietin based therapies for the dialysis
 segment.
 
 In Oncology, our brand portfolio has garnered impressive market share.
 Anchored by our proprietary, anti- cancer MAb, BIOMAb EGFR® and
 supported by our flagship albumin fusion nanoparticle taxane, Abraxane®
 and our biosimilar Granulocyte Stimu- lating Factor (GCSF), NUFIL™, the
 division is gaining good traction in the market having recorded a
 robust YoY growth this fiscal.
 
 The fourth division, Cardiology, launched in 2008 has been propelled by
 our flagship brand STATIX® to a ranking of 23 in a highly crowded
 market. Q3 2011 saw the launch of PRASACT™ (prasugrel) and TIROZEST™
 (tirofiban) to consolidate our interven- tional cardiology portfolio.
 Recent introductions like BESTOR® (rosuvastatin) and ACTIBLOK™
 (metoprolol) continue to follow a high growth trajectory.
 
 In FY 2011, we added two more divisions, Immunotherapy and Com-
 prehensive Care. The Immunotherapy focus in Phase I, is on introducing
 molecules for the treatment of
 
 immune-related dermatological disorders, launched with two diff-
 erentiated molecules in its armory – TBIS® (tacrolimus) and PICON®
 (pimecrolimus), for the treatment of atopic dermatitis and vitiligo.
 Both drugs have been well accepted and are performing exceedingly well
 in the market.
 
 To cater to the critical care segment, Biocon launched a Comprehensive
 Care Division to provide affordable, quality medicines for illness
 including nosocomial infections, post-surgical complications, trauma
 and medical emergencies. I am proud to declare that within just six
 months from launch, this division has gained entry to the countrys
 best corporate hospitals with its high quality portfolio of specialty
 products.
 
 Research & Development
 
 Biocons R&D has had a successful, decade long track record of
 innovation.  Our research efforts have generated a pipeline of generic
 small molecules, biosimilars and novel biologics with the potential of
 unleashing high value growth in a sustained manner over the foreseeable
 future.
 
 Our portfolio of generic molecules has enabled us to garner a dominant
 position as a supplier of generic APIs viz. statins and
 immunosuppressants to US, European and Latin American markets. This, I
 am pleased to say, has yielded good financial returns and has allowed
 us to forge very strong part- nerships with global generics compa-
 nies. One such partner, Mylan, has extended this relationship in 2009,
 to a portfolio of biosimilar monoclonal antibodies. In October 2010, we
 announced a global commercialization partnership with Pfizer for our
 portfolio of recombinant human insulin and insulin analogs. Given the
 growing incidence of diabetes the world over, biosimlar insulins offer
 a large market opportunity from 2014.
 
 Our novel pipeline is also rapidly advancing into the clinic. The most
 advanced programs are IN-105 (oral insulin) and T1h (itolizumab), an
 anti-CD6 targeting MAb, both of which have completed a Phase II/III
 proof of efficacy clinical studies. Although oral insulin did not meet
 its desired primary end-point of HbA1c lowering, this was attributable
 to an unexpectedly high placebo effect due to frequent self
 
 blood glucose monitoring. However, all secondary end-points were met,
 indicative of proof of action, another program, BVX-20, a humanized
 anti- CD20 monoclonal antibody being co-developed with Vaccinex, is
 about to enter the clinic. Two more in early stages of development are:
 a hybrid peptide with dual pharmacology for type II diabetes being
 co-developed with Amylin; and immunoconjugated MAbs which will function
 as tumor vaccines, being developed with IatriCa, a start-up which
 originated from a discovery made at the Johns Hopkins University. We
 expect to initiate discussions for partnering a few of these programs
 in the coming fiscal.
 
 Strategic Partnerships
 
 Partnering has always been at the heart of Biocons business philosophy
 and we will continue to build value through strategic partnering. We
 have sought both research and marketing partner- ships as a way to make
 global impact.
 
 Pfizer
 
 The most visible and high profile part- nership that we recently
 announced was with the worlds leading pharmaceutical company, Pfizer,
 to commercialize
 
 our insulins portfolio. Pfizer will have exclusive and a few
 co-exclusive rights to commercialize these products globally, while
 Biocon will be respon- sible for the clinical development, manufacture
 and supply of these biosimilar insulin products. We firmly believe this
 landmark partnership will drive considerable growth in the foreseeable
 future.
 
 Optimer
 
 FY 2011 also saw Biocon and Optimer Pharmaceuticals Inc. enter into a
 long term supply agreement for the com- mercial manufacturing of the
 API, fidaxomicin, Optimers new drug for the treatment of C. diffcile.
 I believe, our partnership with Optimer is an emphatic recognition of
 Biocons cap- abilities as an R&D partner as well as an acknowledgement
 of our global biomanufacturing strength. I am delighted to inform you
 that Optimer has just received US FDA approval for this molecule which
 positions Biocon as a sole supplier of this drug substance for the
 market launch.
 
 Strategic Foreign Direct Investment
 
 World class infrastructure and attractive tax incentives make Malaysia
 a compell- ing destination for biotechnology.  Investing in Malaysia
 provides us with an international location with strategic geographical
 proximity to India. Biocon is pleased to be an early mover in this
 emerging opportunity and have agreed to invest in establishing a
 biomanufacturing facility at Bio-XCell, a custom-built biotechnology
 park in Iskandar Malaysia, Johor. This invest- ment is the largest for
 the Malaysian biotechnology sector thus far. In the first phase, Biocon
 proposes to invest around RM 500 million (approximately USD 161
 million) to create an insulin manufacturing facility targeted to be
 operational by 2014.
 
 Research Services
 
 Our research services business supported by Syngene and Clinigene,
 continues to be a key growth driver, delivering a CAGR of 13%. We are
 well positioned to take advantage of the increasing trend in big pharma
 to externalize R&D.  Additionally, there is a perceptible drift from
 fee for service and component services to integrated R&D and
 
 partnered co-development on a risk sharing platform. Between Syngene
 and Clinigene, we are uniquely placed to offer end-to-end integrated
 services in both small and large molecules.
 
 Our partnership with Bristol-Myers Squibb is a fore runner of this
 integrated service model. The customized R&D hub, BBRC, that has been
 created at Syngene, is enabling BMS to pursue pipeline development
 through a team of over 450 scientists working seamlessly with BMS labs
 in the U.S.
 
 Beyond Borders
 
 NeoBiocon
 
 After the successful launch of Abraxane® in the UAE region, this year
 NeoBiocon has introduced a range of branded generic products in therapy
 areas of cardiology, diabetology and infection management. We are
 pleased with the progress of this JV and look forward to greater access
 to this high growth region.
 
 AxiCorp
 
 Pursuant to our global insulins part- nership with Pfizer, I would like
 to announce that Biocon is divesting its stake in its German
 subsidiary, AxiCorp
 
 GmbH, to the existing group of pro- moter shareholders. We believe that
 this is in the best interests of the shareholders of both companies.
 Axicorp has done an admirable job in sustaining profitability under
 difficult external circumstances, triggered by German healthcare
 reforms. Biocon wishes AxiCorp´s management and employees the very best
 in their future endeavors.
 
 Corporate Social Responsibility
 
 The year gone by saw Biocon Foun- dation being focused on integrating
 its health initiatives to maximize their impact and relevance to the
 comm- unities it works with. By bringing together the Foundations
 programs in preventive healthcare, primary health- care and health
 insurance for surgery and other hospital care, we aim to make our
 healthcare interventions more effective, sustainable and scalable.
 
 In FY 2011 we concentrated on preventive health, particularly
 addressing problems related to the paucity of doctors. Keeping this in
 mind, we train community health workers to be peer educators and
 
 helpers who administer our programs, ranging from a unique mobile phone
 based cancer screening program, to preventive health education.
 
 Biocon and Biocon Foundation have also assisted the Government of
 Karnataka in building hundreds of homes for displaced families in the
 Bagalkot district of Karnataka that was severely affected by foods.
 
 Looking Ahead
 
 I strongly believe that what we have achieved so far is the beginning
 of a new era of growth. The critical mass
 
 we have built in the domestic formu- lations space gives us the
 confidence to pursue a larger and more responsive brand position in the
 market. We are now Asias largest biopharma company and the only Asian
 company among the top 25 in global biopharma. We are committed to
 strengthening our growth trajectory through branded formu- lations, a
 strong R&D pipeline, an integrated portfolio of research services and
 strategic partnering that provides a global footprint. I would like to
 see Brand Biocon build on its core values of quality, affordability,
 reliability and innovation. That to me is the true and
 
 enduring test of a successful brand in the global arena.
 
 Once again, I commend Biocons people for their entrepreneurial spirit,
 commit- ment, teamwork and integrity. Inspired by the tremendous
 possibilities of science, Team Biocon has remained admirably focused on
 advancing novel therapies, driving our businesses and supporting
 patient health, the world over. I look forward to the year ahead with a
 sense of confidence to deliver even greater value to all our
 stakeholders.
 
 
 
 
 Yours sincerely,
 
 Kiran Mazumdar-Shaw 
 
 May 2011